iCloud Confusion

I am confused by iCloud. I have a MacBook Pro running Sonoma.

I originally thought that the purpose of iCloud was to store a kind of "backup" copy of your files in the cloud. In fact it seems to be more about file sharing between devices. I do know I can access my MacBook files on my iPhone. Fair enough.

But why does it seem to REMOVE files from my hard drive? The files still take up space on my hard drive, but often I can't open them until they are "downloaded." It's like I have "ghost" files on my hard drive that don't come to life until they are downloaded. This is a major problem if I'm trying to access a file but in a situation where I don't have internet access (e.g., on a plane).

Is there some way of making iCloud leave the files on the hard drive alone?

Thank you.